Rumors of a dying Dell
The computer wrangler just shocked the Street with stronger second-quarter results than expected -- and an early release of the information. Earnings fell 23% to $0.24 and sales swooned 22%, or $12.8 billion, as compared to the year-ago quarter. But revenue, unit shipments, and earnings all improved from the previous quarter, and Dell saw $1.1 billion of operating cash flow.
Third-party reports that Dell's consumer division wasn't moving units turned out to be mistaken, that segment saw 17% higher unit volumes than last year and only 9% lower dollar sales, which beats market leader Hewlett-Packard's
Corporate accounts, large and small, still seem to be holding back on their IT infrastructure buys. If they're just waiting for Microsoft
So the road to recovery for corporate accounts could very well be much longer than for the consumer business -- with or without Microsoft's help. Government sales are holding up much better than the business-to-business sales. That's how Dell sees the markets playing out this fall, and I concur.
Dell's stock jumped about 14% between 3:30 yesterday and today’s opening, including a 7% pop in the minutes between Dell sharing the information prematurely and yesterday's market close. However, the stock has since settled at around $16 a share, still a tidy gain. All told, Dell has just about doubled since bottoming out in March, keeping pace even with bitter rival and habitual growth champion Apple
Dell will certainly survive, and is still an amazing cash machine -- but are these results enough to make you want to buy the stock today? Some winners just keep winning, you know. Share your thoughts in the comments box below.
Fool contributor Anders Bylund owns shares in AMD, but he holds no other position in any of the companies discussed here. You can check out Anders' holdings or a concise bio if you like, and The Motley Fool is investors writing for investors.